Brinker International reports $1.536 billion revenue, focuses on digital takeout growth

Brinker International, the parent company of Chili's, announced a strong fiscal fourth-quarter performance on Wednesday, driving its stock price up. The company reported adjusted earnings of $3.07 per share, slightly below analyst expectations of $3.09, while total revenue rose to $1.536 billion, surpassing forecasts of $1.534 billion. The positive market reaction was likely amplified by significant short selling, with 18% of the public float sold short, indicating a bearish sentiment that may have contributed to the stock rally.

The results come as Brinker seeks to strengthen its digital and takeout business, with CEO Kevin Hochman emphasizing takeout as "the next big frontier." He noted that takeout currently accounts for 25% of Chili's business but believes there is substantial room for growth. Hochman pointed to five consecutive years of same-store sales growth at Chili's, totaling a 71% increase over this period, fueled by strong brand relevance and operational improvements.

Chili's comparable sales rose 5.6% during the quarter, driven by a combination of pricing strategies and increased customer traffic. The introduction of the Big Crispy chicken sandwich has been particularly successful, with sales rising from 20 to 55 sandwiches per restaurant per day by the end of the quarter. Despite a slight dip in sales at Maggiano's, overall company comparable restaurant sales increased by 5%, indicating strong performance across the portfolio.

Looking ahead, Brinker plans to enhance its mobile app, streamline pickup processes, and improve order accuracy to better compete in the fast-food digital landscape. With operating income rising to $167 million and margins expanding, the company aims to capitalize on its momentum and further penetrate the growing takeout market. The focus on digital innovation is expected to position Chili's as a more formidable player in the competitive fast-food sector.